Goldman Sachs announced its partnership with IDG Capital Partners, a major Chinese investment firm, to make a $50 million investment into Circle Internet Financial, a Bitcoin-focused start-up.

On Wednesday, it was announced that Goldman Sachs Group Inc. invested in a $50 million fundraising round in Bitcoin-focused start-up dubbed Circle Internet Financial Ltd which aims at “enabling greater ease-of-use in online and in-person payments, enhanced security and privacy for consumers, and the convenience of free, instant, global digital money transfers.”

The round was co-led by IDG Capital Partners, and included such investors as Breyer Capital, Oak Investment Partners, General Catalyst Partners, and Accel Partners from which Circle had previously received investments.

Bloomberg Business reports that the round brought Circle’s total funding to $76 million. In a telephone interview, Jeremy Allaire, co-founder and chief executive of Circle, said that it “is a material step-up in valuation from our past financing”, but he refused to speak about the specific value.

“Having a franchise like Goldman Sachs as an investor, who has done due diligence, is a vote of confidence,” said Mr. Allaire.

The statement made by Thomas F. Jessop, the head of the principal strategic group at Goldman, didn’t include any comments on Bitcoin. According to Mr Jessop, the company views “significant opportunities in companies and solutions that have the promise to transform global markets through technical innovation.”

It’s necessary to mention that in March, Goldman issued a report regarding Bitcoin’s potential. The research report says that Bitcoin as an alternative currency is strongly overrated, but it might have a future as a payment technology.

“Although Bitcoin and other crypto-currencies are still in the early stages of development, they could gain traction once clear use cases become more established,” says the report.

Actually, in the U.S. lots of Bitcoin start-ups are having problems when trying to open bank accounts. In fact, almost the only American bank which was willing to collaborate with Bitcoin firms was Silicon Valley Bank.

Unfortunately, it’s still unclear for plenty of banks how bank regulators view Bitcoin companies.  According to New York Times, Benjamin M. Lawsky, New York state’s top financial regulator, is completing a BitLicense for virtual currency firms which is expected to be out in May. Circle already has ordinary money-transmitter licenses from many other states, and is going to apply for a BitLicense.

“Up until now Bitcoin has really been driven by the speculative value phase,” Mr. Allaire said. “We’ve said it needs to move to the utility value phase.”

So far, Goldman won’t neither hold Bitcoins nor become Circle’s bank, but its investment in this start-up will help enhance Bitcoin’s potential and reputation as a technology that important financial companies can work with.

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